A common type of network-based transaction is purchasing goods or services via a network-based transaction facility, e.g., a website on the Internet. A common problem associated with such network-based transactions is fraud. For example, a seller may defraud a buyer and vice versa a buyer may defraud a seller. One type of network-based transaction is an online-auction transaction. In an online-auction transaction, a seller may offer an item for sale via an auction website in which a number of bidders access the website and bid for the item. A transaction is completed after the winning bidder pays for the item and the seller delivers the item to the winning bidder.
However, a seller may defraud a winning bidder, e.g., by accepting payment of an auctioned item and not delivering the item, delivering the item defective, delivering the item that is different than an advertised description of the item, or delivering a counterfeit item. Alternatively, a winning bidder may defraud a seller, e.g., by sending an incorrect amount of payment, sending a form of payment that is defective, or sending a form of payment with insufficient funds.
Thus, there is a need to allow users to report and settle potential fraud cases and, if transactions are fraudulent, allow users to file insurance claims for such transactions in which financial loss has occurred.